Third Quarter, 2022

“September To Remember”

Playing off the slogan for a well-known automobile brand’s successful “December to Remember” year-end sales event, investment markets in 2022 had a “September to Remember” sale that was not so successful in attracting buyers with lower prices.

Here are just a few records that have been broken in this “September to Remember”:

• • Bank of America reported that government bond losses were the highest since 1920.
  • At quarter-end, a more diversified bond index, the Bloomberg AGG, was down (16%), which was its worst performance since 1976.
  • On 9/22/22, JP Morgan reported 88% of the US investment grade bond market was trading at a discount, but that can be good news when putting new money to work.
  • Stock market returns are even worse. By quarter-end year-to-date MSCI world stock index outside the U.S. was down (28%), and the U.S. SP500 index was down (25%).
  • Mortgage rates rose to 6.7% highest since July 2007, but not nearly as high as 19% in the early 80s when inflation was 14.6%. Now the Federal Reserve is battling 8.5% inflation.
  • The Federal Reserve has stated it will continue to raise rates, even risking recession, since unemployment is at such low levels. Oil prices plunged (23%) in 3Q22 and are closer to the levels before Russia invaded Ukraine.

Good news ahead?  Markets have already priced in the bad news above.  Bond yields are at their highest in more than a decade, savers are finally getting interest, and yes, investors can buy stocks & bonds on sale now, which can lead to better returns in the future. Investors who are patient can recover losses.

So stay tuned; we could have a “December to Remember” on the upside. 

– Phyllis

Sources include:  Wall St. Journal; Bloomberg News; Advisor Perspectives.com; Financial Advisor News

Author: Senior Vice President Senior Wealth StrategistPhyllis had been associated with W&A for a number of years before joining the firm, acting as a consultant to the company in its formative stage and subsequently as a client. Prior to joining W&A, Phyllis served as Vice President, Corporate Finance at Morgan Keegan & Company, Inc. She was involved in all aspects of its investment banking activities, including mergers and acquisitions, valuation studies, and initial public offerings. She earned registrations in NASD Series 7 (Registered Representative) and Series 63 (Blue Sky). Phyllis holds an MBA in Finance as well as M.Ed and BBA degrees from the University of Memphis. She is a Chartered Financial AnalystTM(CFA®) and a Certified Financial PlannerTM(CFP®) Licensee. She is past-Chairman and past-President of the Mid-South Society of the Financial Planning Association (FPA) and served on their Board of Directors from 1995 to 2000. During her term as President in 1998, the Mid- South Society of FPA was chosen the Outstanding Society of the Year by the national FPA organization. Her community volunteer activities include MIFA and the Women’s Foundation for a Greater Memphis, where she served as Treasurer, Chair of the Finance Committee and currently chairs the Investment Committee. She also serves on the Board of Governors of The Seaside Institute in Seaside, FL.

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